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As told in my previous post, I’m starting a series of posts based on a paper I wrote back in 2002 as part of my Master in International Marketing.
In this first post, I will go over the concept of Knowledge Management, try to see in how much what was said 6 years ago still holds true, and see how today’s concept of Enterprise 2.0 can be linked to it …

Definition

Knowledge Management is probably the term for which I found the most definitions, a lot of them being written in an obscure corporate gibberish.

But in all these definitions one came out as being concise, complete and clearly understandable;

“The conscious strategy of getting the right knowledge to the right people at the right time and helping people share and put information into action in ways that strive to improve organizational performance.” (source: »If only we knew what we know« )

However complete, this definition still does not explain what ‘Knowledge’ means. The definitions hereunder and on the next page will give an idea as to how this term should be understood in a business environment:

“The integration of ideas, experience, intuition, skill, and lessons learned that has the potential to create value for a business, its employees, its products and services, its customers and ultimately its shareholders by informing decisions and improving actions.” (source: the link is unfostunately dead since I found it)

“A fluid mix of framed experience, values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information. It originates and is applied in the minds of ‘knowers’. In organizations, it often becomes embedded not only in documents or repositories but also in organizational routines, processes, practices, and norms. Key concepts of knowledge are experience, truth, judgment, and rules of thumb.”(source: « Working Knowledge« )

In the light of these last two definitions, we now understand KM as being the sharing of about anything that can be found in the heads of the people and in their documents and routines, in a way that it will benefit the company.

The usual way to share this knowledge is to create a so-called ‘Knowledge Library’, a database in which everyone will be able to fill or retrieve knowledgeable information.

Key Success Factors

There is a major challenge when developing KM in a company: The creation of a Knowledge Culture, i.e. a desire among employees to tap into their company’s intellectual resources and to participate in its creation/updates.

Actually, both sides of the challenge are linked and one will often be able to tackle the second one by successfully solving the first one. Indeed, the best way to motivate someone to share his knowledge is to show him the benefits of the knowledge library, i.e. to show him that it is the place where he may find solutions to his problems.

A problem that may arise when people look into the Knowledge Library is that while ‘Information’ is generally facts, ‘Knowledge’ focuses on linkage or relationships and is therefore subjective. Each employee will weigh this knowledge against a different set of experiences when deciding its meaning, value and use.

A McKinsey research paper (in pdf here) has shown that companies who were successful in their KM projects had adopted one, or several, of the following three tactics:

Granting financial and other incentives (office space, more challenging assignments, …) to reward employees who pull or push knowledge;

Keeping KM in mind when crafting their overall strategies.

Now, each tactic has its own pitfalls that should be watched carefully when used, but the most dangerous one is the pitfall of the incentives solution. If not carefully developed, this system could encourage the hoarding of knowledge.

Key Failure Factors

Many companies launch KM initiatives that “start with a bang and end with a whimper” .

According to the American Productivity & Quality Centre (APQC), most programs are in danger of encountering most problems in the pilot phase. So let’s have a quick look at the major issues that may hamper the launch of a KM initiative.

As with (too) many projects with an impact on quality and productivity, a lot of companies see KM as an end in itself. They will start this projects because they believe it will pay off later, or, because they believe that effective organization have to share knowledge across departments. While this might sound as a quite good attitude, it actually takes the issue backwards: the ultimate goal is not to make KM happen, but to tackle an issue encountered by the company, using KM as a mean towards the solution. If there is no business purpose to it, it does not make sense developing a KM program!

The pilot phase of a new program usually receives a lot of attention because it brings some change in the everyday routine. Also, senior management, seeing the pilot think it is great and sponsor it. But senior management’s attention span can be quite short: something in the market requires everybody’s attention, or managers are transferred, or another management hot topic appears and the attention is all gone, as well as the resources! A way to avoid this is to plan the rollout at the same time as the pilot, so managers will have to acknowledge that there is something after the pilot! Therefore, poor planning is a sure way to deem a KM initiative to failure.

Financial investments in a KM program are usually quite high. The APQC benchmarks show that successful companies have paid more than $ 1 million to get the program started and have kept spending more than that amount annually thereafter. Companies like the big consulting groups can spend up to 6% of revenue on Knowledge Management!

KM initiatives will not last very long unless responsibility for them is someone’s job: the CKM or Chief Knowledge Manager. In large corporation, it is even better to have a whole team dedicated to it, headed by a Chief Knowledge Officer. Lack of accountability is another pothole that must be avoided.

Last but not least, measuring the progress of a KM initiative can be quite sticky. Indeed, as stated before, KM is quite subjective and so are its results. How can one be sure that the gain in productivity, or the new market shares, etc. were really prompted by the implementation of the KM program?

So where are we today?

Quite frankly, in my opinion, one could replace the words ‘knowledge management’ by ‘enterprise social softwares’ in this text without problem.

The goal of ESS is more or less the same as that of KM: allowing people to work better. Even better, in my opinion, ESS can replace any KM solution out there. I find the combination of blogs, wikis, etc much more powerful and flexible than any Knowledge Management system … This being said, I believe that the KM software/consulting industry has seen the light and integrates more and more the ESS in their offer …

The Key Success Factors are exactly the same, too

Only in the Key Failure Factors, do I see a difference: the investment needed!

Indeed there are many solutions out there in the Open Source world to find tools that will suffice most organizations in terms of blogging, wikis, social softwares, and the like …

Of course, if you don’t want to spend time stting it up by yourself, or if your organization is large enough , and you have the financial resources to buy a ready-made solution from the various vendors, go for it! The investment should still be much lower than what it was in 2002.